This ruling modifies the rules for group trusts described in
Rev. Rul. 81-100, 1981-1 C.B. 326, as clarified and modified by Rev.
Rul. 2004-67, 2004-2 C.B. 28. The modifications revise the generally
applicable rules for these group trusts and, if certain requirements
are met, permit the participation in group trusts of custodial accounts
under section 403(b)(7), retirement income accounts under section
403(b)(9), and governmental retiree benefit plans under section 401(a)(24).
This ruling also modifies the transition relief provided in Rev. Rul.
2008-40, 2008-2 C.B. 166, relating to plans qualifying under section
1165 of the Puerto Rico Internal Revenue Code (Puerto Rico Code).
In addition, this ruling provides related model language that may
be used by group trusts to comply with these new provisions. Rev.
Ruls. 81-100, 2004-67, and 2008-40 modified.

PURPOSE

This revenue ruling modifies the rules for group trusts described
in Rev. Rul. 81-100, 1981-1 C.B. 326, as clarified and modified by
Rev. Rul. 2004-67, 2004-2 C.B. 28. The modifications revise the generally
applicable rules for these group trusts and, if certain requirements
are met, permit the participation in group trusts of custodial accounts
under § 403(b)(7), retirement income accounts under § 403(b)(9),
and governmental retiree benefit plans under § 401(a)(24).
In addition, this revenue ruling provides related model language
that may be used by group trusts to comply with these new provisions.
This revenue ruling also modifies the transition relief provided
in Rev. Rul. 2008-40, 2008-2 C.B. 166, relating to plans qualifying
under section 1165 of the Puerto Rico Internal Revenue Code (Puerto
Rico Code).

ISSUE

Under what conditions may the assets of qualified plans under
§ 401(a), individual retirement accounts (IRAs) under § 408
(including Roth IRAs under §408A), and eligible governmental
plans under § 457(b) be pooled in a group trust described
in Rev. Rul. 81-100 with the assets of custodial accounts under § 403(b)(7),
retirement income accounts under § 403(b)(9), and governmental
plans under § 401(a)(24) without affecting the tax status
of these entities or the group trust?

LAW AND ANALYSIS

Section 401(a) provides that a trust created or organized in
the United States and forming a part of a stock bonus, pension, or
profit-sharing plan of an employer for the exclusive benefit of its
employees or their beneficiaries is qualified if it meets certain
requirements. Section 401(a)(1) provides that one of these requirements
is that contributions be made to the trust by the applicable employer
or employees, or both, for the purpose of distributing to such employees
or their beneficiaries the corpus and income
of the fund accumulated in accordance with such plan. Section 501(a)
provides, in part, that a trust described in § 401(a) is
exempt from income tax. Section 401(a)(2) provides, in part, that
under each trust instrument it must be impossible, at any time prior
to the satisfaction of all liabilities with respect to employees and
their beneficiaries under the plan and the trust, for any part of
the corpus or income of the trust to be used
for or diverted to purposes other than for the exclusive benefit of
the employees or their beneficiaries. Similarly, § 408
provides that an IRA means a trust created or organized “for
the exclusive benefit of an individual or his beneficiaries”
and § 457(g) provides that the assets of an eligible governmental
plan under § 457(b) must be held in trust “for the
exclusive benefit of participants and their beneficiaries.”

Section 401(a)(24) provides that any group trust that otherwise
meets the requirements of § 401(a) does not fail to satisfy
such requirements due to the participation or inclusion of the monies
of a plan or governmental unit described in § 818(a)(6)
in the group trust. Section 818(a)(6) contains special rules regarding
the definition of the term “pension plan contract.”
Section 818(a)(6)(A) defines the term to include a contract purchased
by a governmental plan (within the meaning of § 414(d))
and an eligible governmental plan under § 457(b). Section
818(a)(6)(B) further defines the term to include a contract purchased
by the Government of the United States, the government of any state
or political subdivision thereof, or by any agency or instrumentality
of the foregoing, or any organization (other than a governmental unit)
exempt from tax under subtitle A (income taxes), for use in satisfying
an obligation of such government, political subdivision, agency, instrumentality,
or organization to provide a benefit under a plan described in § 818(a)(6)(A).[1]

Section 401(f)(1) provides that a custodial account, an annuity
contract, or a contract (other than a life, health or accident, property,
casualty, or liability insurance contract) issued by an insurance
company qualified to do business in a State is treated as a qualified
trust under § 401 if the custodial account or contract would
constitute a qualified trust under § 401, except for the
fact that it is not a trust. Section 401(f)(2) requires that the
assets in any such custodial account are to be held by a bank within
the meaning of § 408(n) or “another person”
that demonstrates that it will hold the assets in a manner consistent
with the requirements of § 401. See § 1.408-2(e)
of the Income Tax Regulations for rules regarding nonbank trustees.

Section 403(b) generally provides that amounts contributed by
an employer for an annuity contract are excluded from the gross income
of the employee for the taxable year if certain requirements are satisfied.
Section 403(b) applies to contributions made: for an employee by
an employer described in § 501(c)(3) which is exempt from
taxation under § 501(a); for an employee who performs services
for an educational organization described in § 170(b)(1)(A)(ii)
by an employer which is a State, a political subdivision of a State,
or an agency or instrumentality of any one of the foregoing; or for
a minister described in § 414(e)(5)(A) by the minister or
by an employer.

Section 403(b)(7)(A) provides, in part, that amounts paid by
an employer described in § 403(b)(1) to a custodial account
which satisfies the requirements of § 401(f)(2) are treated
as amounts contributed for an annuity contract for the employee if
the amounts are to be invested in regulated investment company stock
to be held in that custodial account. Section 403(b)(7)(B) provides
that a custodial account which satisfies the requirements of § 401(f)(2)
is treated as an organization described in § 401(a) solely
for purposes of subchapter F of chapter 1 of subtitle A of the Code
(§§ 501-530) and subtitle F of the Code (pertaining
to procedure and administration) with respect to amounts received
by the account and with respect to income from the investment of these
amounts. Section 1.403(b)-8(d)(2)(i) provides that all of the amounts
held in the account must be invested in the stock of a regulated investment
company (as defined in § 851(a)). Section 1.403(b)-8(d)(2)(i)
provides that the assets of a custodial account under § 403(b)(7)
cannot be commingled in a group trust with any assets other than those
of a regulated investment company described in § 851(a).
Section 1.403(b)-8(d)(2)(iii) provides that a custodial account under
§ 403(b)(7) must contain a written statement that the assets
held in a custodial account cannot be used for, or diverted to, purposes
other than for the exclusive benefit of plan participants or their
beneficiaries.

Section 403(b)(9) provides that a retirement income account
is treated as an annuity contract and amounts paid by an employer
described in § 403(b)(1)(A) to a retirement income account
are treated as amounts contributed to an annuity contract for the
employee. Section 403(b)(9)(B) provides that a retirement income
account means a defined contribution program established or maintained
by a church, or convention or association of churches, including an
organization described in § 414(e)(3)(A), to provide benefits
under § 403(b) for an employee described in § 403(b)(1)
or the employee’s beneficiaries. Section 1.403(b)-9(a)(2)(i)
requires separate accounting for the retirement income account’s
interest in the underlying assets, and that a § 403(b)(9)
retirement income account contain a written statement that the assets
held in the retirement income account cannot be used for, or diverted
to, purposes other than for the exclusive benefit of plan participants
or their beneficiaries.

Rev. Rul. 81-100, as clarified and modified by Rev. Rul. 2004-67,
holds that if specified requirements are satisfied, a group trust
is exempt from taxation under § 501(a) with respect to its
funds which equitably belong to participating trusts described in
§ 401(a) and is exempt from taxation under § 408(e)
with respect to its funds which equitably belong to IRAs. Rev. Rul.
81-100, as clarified and modified by Rev. Rul. 2004-67, sets forth
the following requirements for a group trust: (1) the group trust
must be adopted as a part of each adopting employer’s plan or
each adopting individual retirement account; (2) the group trust instrument
must expressly limit participation in the group trust to pension,
profit-sharing, and stock bonus trusts or custodial accounts qualifying
under § 401(a) that are exempt under § 501(a),
individual retirement accounts that are exempt under § 408(e),
and eligible governmental plan trusts or custodial accounts under
§ 457(b) that are exempt under § 457(g) (adopting
entities); (3) the group trust instrument must prohibit any part of
its corpus or income that equitably belongs to
any adopting entity from being used for or diverted to any purpose
other than for the exclusive benefit of the employees (and the individual
for whom an individual retirement account is maintained) and their
beneficiaries who are entitled to benefits under such adopting entity;
(4) the group trust instrument must prohibit the assignment by an
adopting entity of any part of its equity or interest in the group
trust; and (5) the group trust must be created or organized in the
United States and be maintained at all times as a domestic trust in
the United States.

To ensure that the assets of a group trust described in Rev.
Rul. 81-100, as clarified and modified by Rev. Rul. 2004-67 (generally
referred to hereinafter as an 81-100 group trust), are only commingled
with the assets of similar plans or arrangements, each entity adopting
the group trust must be tax-exempt under § 501(a) of the
Code (or not subject to Federal income taxation) and must be part
of a plan that satisfies an exclusive benefit rule that is similar
to the exclusive benefit rule of § 401(a) and § 1.401(a)-2,
as more fully described in paragraph (5) of the Holding of this revenue ruling. For this purpose, the
group trust must also keep separate records of each adopting entity’s
interest in the group trust, as more fully described in paragraph
(6) of the Holding of this revenue
ruling.

The Service has received several inquiries as to whether a governmental
plan that provides retiree welfare benefits will be treated as a plan
described in § 401(a)(24) and may invest in an 81-100 group
trust. Section 401(a)(24) applies to governmental plans that provide
pension benefits and to governmental plans that provide other employee
benefits for retirees such as retiree welfare benefits (a § 401(a)(24)
governmental plan). Accordingly, a governmental plan providing retiree
welfare benefits may be treated as a governmental plan under § 401(a)(24)
and may invest in an 81-100 group trust.

The Service has also received inquiries as to whether a plan
described in section 1022(i)(1) of the Employee Retirement Income
Security Act of 1974 (ERISA) (a section 1022(i)(1) plan) may participate
in an 81-100 group trust. Some of these inquiries have arisen in
the context of Rev. Rul. 2008-40, which holds that a transfer of assets
and liabilities from a qualified plan to a plan that satisfies section
1165 of the Puerto Rico Code is treated as a distribution from the
transferor plan, even if the recipient plan is described in section
1022(i)(1) of ERISA. Rev. Rul. 2008-40 also provides, however, that
this holding is not effective for a transfer if the date of the transfer
is before January 1, 2011. The inquiries state that sponsors of qualified
plans currently participating in 81-100 group trusts want to transfer
assets and liabilities to section 1022(i)(1) plans prior to January
1, 2011, but are concerned that such plans may not be able to participate
in an 81-100 group trust. If a section 1022(i)(1) plan is not permitted
to participate in an 81-100 group trust then, upon a transfer of assets
and liabilities from a qualified plan to a section 1022(i)(1) plan
prior to January 1, 2011, pursuant to the relief set forth in Rev.
Rul. 2008-40, the assets that are transferred to a section 1022(i)(1)
plan that were previously invested in the 81-100 group trust will
need to be distributed to the plans from the group trust and the plans
will lose the advantages of participating in the group trust.

Section 4042(d) of ERISA authorizes the Pension Benefit Guaranty
Corporation (PBGC) as statutory trustee to take control of the assets
of a terminated plan. Under ERISA section 4042(a), the PBGC maintains
certain commingled trust funds to hold and invest such assets upon
becoming statutory trustee. These commingled trust funds are limited
to (i) assets attributable to terminated tax-qualified defined benefit
plans for which the PBGC has become statutory trustee, and (ii) assets
transferred to the PBGC under ERISA section 4050 from terminated tax-qualified
plans which, under ERISA section 4050(a)(2), are treated as assets
attributable to terminated tax-qualified defined benefit plans for
which the PBGC has become statutory trustee. Thus, from time to time,
a group trust may hold assets attributable to PBGC’s commingled
trust funds.

HOLDING

Accordingly, on or after January 10, 2011, provided that the
requirements below are satisfied, the assets of qualified plans under
§ 401(a), IRAs, and eligible governmental plans under § 457(b)
may be pooled in a group trust described in Rev. Rul. 81-100, as clarified
and modified by Rev. Rul. 2004-67 and this revenue ruling, with the
assets of custodial accounts under § 403(b)(7), retirement
income accounts under § 403(b)(9), and § 401(a)(24)
governmental plans without affecting the tax status of the group trust
or the tax status of each of the separate group trust retiree benefit
plans participating in the group trust. For purposes of this revenue
ruling, all of the entities listed in the preceding sentence are collectively
referred to as “group trust retiree benefit plans.”

A custodial account under § 403(b)(7) will fail to
satisfy § 1.403(b)-8(d)(2)(i) if the assets of the account
are invested other than in the stock of a regulated investment company,
and any group trust in which the assets of a § 403(b)(7)
custodial account is invested must comply with this restriction.
Accordingly, as a result of this investment restriction, the assets
of a custodial account under § 403(b)(7) generally will
be commingled in a group trust that solely contains the assets of
other § 403(b)(7) custodial accounts.

If the requirements below are satisfied, the tax status of the
group trust will be derived from the tax status of the participating
entities to the extent of their equitable interests in the group trust.
Thus, for example, a group trust is exempt from taxation under § 501(a)
with respect to the assets of the group trust which equitably belong
to participating trusts described in § 401(a) that are exempt
from tax under § 501(a).

The requirements are as follows:

(1) The group trust is itself adopted as a part of each adopting
group trust retiree benefit plan.

(3) The group trust instrument expressly prohibits any part
of its corpus or income that equitably belongs
to any adopting group trust retiree benefit plan from being used for,
or diverted to, any purpose other than for the exclusive benefit of
the participants and the beneficiaries of the group trust retiree
benefit plan. For example, plan assets are treated as used for, or
diverted to, a purpose other than for the exclusive benefit of the
plan participants or beneficiaries if the assets of one group trust
retiree benefit plan are used to provide benefits under another group
trust retiree benefit plan even if the plan participant or beneficiary
receiving the benefits is a participant or beneficiary under both
plans.

(4) Each group trust retiree benefit plan entity which adopts
the group trust is itself a trust, a custodial account, or a similar
entity that is tax-exempt under § 408(e) or § 501(a)
(or is treated as tax-exempt under § 501(a)). A group trust
retiree benefit plan that is a § 401(a)(24) governmental
plan is treated as meeting this requirement if it is not subject to
Federal income taxation.

(5) Each group trust retiree benefit plan which adopts the group
trust expressly provides in its governing document that it is impossible
for any part of the corpus or income of the group
trust retiree benefit plan to be used for, or diverted to, purposes
other than for the exclusive benefit of the plan participants and
their beneficiaries. For this purpose, assets of a group trust retiree
benefit plan are treated as used for, or diverted to, purposes other
than for the exclusive benefit of the plan participants and their
beneficiaries if there is a loan or other extension of credit from
assets in the group trust to the employer. In addition, plan assets
are used for, or diverted to, purposes other than for the exclusive
benefit of the plan participants and their beneficiaries if the assets
of one group trust retiree benefit plan are used to provide benefits
under another group trust retiree benefit plan even if the plan participant
or beneficiary receiving the benefits is a participant or beneficiary
under both plans. The exclusive benefit requirement described in
this paragraph (5) must be irrevocable. Plans that satisfy the following
regulations, with respect to each type of adopting plan to which the
regulations apply, will satisfy this paragraph (5): § 1.401(a)-2
(for qualified plans); § 1.403(b)-8(d)(2)(iii) (for § 403(b)(7)
custodial accounts); § 1.403(b)-9(a)(2)(i)(C) (for § 403(b)(9)
retirement income accounts); § 1.408-2(b) (for IRAs); and
§ 1.457-8(a)(2)(i) (for eligible governmental plans described
in § 457(g)).

(6) The group trust instrument expressly limits the assets that
may be held by the group trust to assets that are contributed by,
or transferred from, a group trust retiree benefit plan to the group
trust (and the earnings thereon), and the group trust instrument expressly
provides for separate accounts (and appropriate records) to be maintained
to reflect the interest which each adopting group trust retiree benefit
plan has in the group trust, including separate accounting for contributions
to the group trust from the adopting plan, disbursements made from
the adopting plan’s account in the group trust, and investment
experience of the group trust allocable to that account. A transaction
or accounting method which has the effect of directly or indirectly
transferring value from the account of one adopting plan into the
account of another adopting plan violates this separate accounting
requirement. However, a transaction that merely exchanges investments
at fair market value between the accounts of one adopting plan to
another account of that adopting plan does not violate this separate
accounting requirement.

(7) The group trust instrument expressly prohibits an assignment
by an adopting group trust retiree benefit plan of any part of its
equity or interest in the group trust.

(8) The group trust is created or organized in the United States
and is maintained at all times as a domestic trust in the United States.

In addition, under ERISA section 4042(a), the PBGC maintains
certain commingled trust funds which are limited to (i) assets attributable
to terminated tax-qualified defined benefit plans for which the PBGC
has become statutory trustee under section 4042 of ERISA, and (ii)
assets transferred to the PBGC under ERISA section 4050 from terminated
tax-qualified plans which, under ERISA section 4050(a)(2), are treated
as assets attributable to terminated tax-qualified defined benefit
plans for which the PBGC has become statutory trustee. A group trust
will not be treated as failing to satisfy the foregoing enumerated
requirements of this revenue ruling merely because the PBGC, rather
than a qualified plan, holds the interest in the group trust or merely
because the group trust holds assets attributable to PBGC’s
commingled trust funds.

MODEL AMENDMENTS

There are two model amendments set forth below. Amendment 1
is for a group trust that received a determination letter from the
Service prior to January 10, 2011, that the group trust satisfies
Rev. Rul. 81-100, but that does not satisfy the separate account requirement
of paragraph (6) of the Holding in
this revenue ruling. Amendment 2 is for a group trust that received
a determination letter from the Service prior to January 10, 2011,
that the group trust satisfies Rev. Rul. 81-100, and that intends
to permit custodial accounts under § 403(b)(7), retirement
income accounts under § 403(b)(9), or § 401(a)(24)
governmental retirement plans to participate in the group trust.
Both model amendments should be adopted by group trusts that do not
satisfy the separate account requirement and intend to permit custodial
accounts under § 403(b)(7), retirement income accounts under
§ 403(b)(9), or § 401(a)(24) governmental retirement
plans to participate in the group trust.

AMENDMENT 1 — GROUP TRUSTS THAT
DO NOT SATISFY THE SEPARATE ACCOUNT REQUIREMENT

In general, group trusts that have received favorable determination
letters from the Service currently satisfy the separate account requirement
of paragraph (6) of the Holding in
this revenue ruling. However, a sponsor of a group trust that satisfies
Rev. Rul. 81-100, as modified by Rev. Rul. 2004-67, but that does
not currently provide for separate accounts, must amend its group
trust instrument by January 10, 2012, to provide for separate accounts
as required under this revenue ruling. A sponsor of a group trust
may satisfy this requirement by amending its group trust instrument
to include the model language below:

“A separate account will be maintained to reflect the
interest of each adopting group trust retiree benefit plan, including
separate accounting for contributions to the group trust by each such
plan, disbursements made from each such plan’s account, and
the investment experience of the group trust as allocable to that
account.”

AMENDMENT 2 — GROUP TRUSTS INTENDING
TO PERMIT OTHER GROUP TRUST RETIREE BENEFIT PLANS TO PARTICIPATE

A sponsor of a group trust that satisfies Rev. Rul. 81-100,
as modified by Rev. Rul. 2004-67, may amend its group trust instrument
to include the model language below to reflect this revenue ruling:

“This group trust is operated or maintained exclusively
for the commingling and collective investment of funds from other
trusts that it holds. Notwithstanding any contrary provision in this
group trust, the trustee of this group trust is permitted, unless
restricted in writing by the named fiduciary, to hold in this group
trust funds that consist exclusively of trust assets held under plans
qualified under Internal Revenue Code (Code) § 401(a) that
are exempt under Code § 501(a); funds from Code § 401(a)(24)
governmental retiree benefit plans that are not subject to Federal
income taxation; funds from retirement income accounts under Code
§ 403(b)(9); funds from individual retirement accounts that
are exempt under Code § 408(e); and funds from eligible
governmental plan trusts or custodial accounts under Code § 457(b)
that are exempt under Code § 457(g). The trustee of this
group trust is also permitted, unless restricted in writing by the
named fiduciary, to hold funds in this group trust that consist of
assets of custodial accounts under Code § 403(b)(7), provided
that if assets of a custodial account under § 403(b)(7)
are invested in the group trust, all assets of the group trust, including
the § 403(b)(7) custodial accounts, are solely permitted
to be invested in stock of regulated investment companies. For this
purpose, a trust includes a custodial account that is treated as a
trust under Code § 401(f), 403(b)(7), 408(h), or 457(g)(3).

“For purposes of valuation, the value of the interest
maintained by the fund with respect to any plan or account in such
group trust shall be the fair market value of the portion of the fund
held for that plan or account, determined in accordance with generally
recognized valuation procedures.”

RELIANCE BY TRUSTEES WITH PRIOR DETERMINATION
LETTER

If a group trust instrument provides that amendments to the
group trust will automatically pass-through to the group trust retiree
benefit plan, and the trustee of the group trust is otherwise entitled
to rely on a favorable determination letter issued to it prior to
January 10, 2011, regarding eligibility of its group trust under Rev.
Rul. 81-100, the group trust trustee will not lose its right to rely
on its determination letter merely because it adopts Model Amendment
1 or Model Amendment 2 set forth above in this revenue ruling on a
word-for-word basis (or adopts an amendment that is substantially
similar in all material respects). Thus, such a trustee may adopt
Model Amendment 1 or Model Amendment 2 on a word-for-word basis (or
adopt an amendment that is substantially similar in all material respects)
and continue to rely on the previously issued determination letter
regarding its group trust without filing a request with the Service
for a new determination letter.

A trustee of a group trust that satisfies the above requirements
and amends its group trust to include Model Amendment 1 or Model Amendment
2 on a word-for-word basis (or adopts an amendment that is substantially
similar in all material respects) will also not lose its right to
rely on its prior determination letter merely because it becomes necessary,
as a result of the adoption of such model amendment (or an amendment
that is substantially similar in all material respects), to modify
or delete a prior provision that is inconsistent with the model amendment
so adopted (or an amendment that is substantially similar in all material
respects that is so adopted).

Generally, the group trust instrument will provide that amendments
to the group trust will automatically pass through to the group trust
retiree benefit plans. However, a group trust that has received a
favorable determination letter under Rev. Proc. 2010-6, 2010-1 I.R.B.
193 (or its predecessors), that does not contain such a pass-through
provision may not adopt Model Amendment 1 or Model Amendment 2 and
automatically continue to rely on its determination letter.

PLANS DESCRIBED IN SECTION 1022(i)(1)
OF ERISA

The Service anticipates issuing guidance as to whether a plan
described in section 1022(i)(1) of ERISA may participate in an 81-100
group trust. Until such guidance is issued, the Service will not
treat a group trust as failing to satisfy the requirements of this
revenue ruling merely because the group trust includes the assets
of a section 1022(i)(1) plan as long as the section 1022(i)(1) plan
(1) was participating in the group trust as of January 10, 2011, or
(2) holds assets that had been held by a qualified plan immediately
prior to the transfer of those assets to the section 1022(i)(1) plan
pursuant to the transition relief in Rev. Rul. 2008-40, as modified
by this revenue ruling. In addition, Rev. Rul. 2008-40 is hereby
modified to extend the transition relief for transfers from a qualified
plan to a section 1022(i)(1) transferee plan for an additional year.
Thus, “January 1, 2012” is substituted for “January
1, 2011” each place it appears in the Transition Relief section
of Rev. Rul. 2008-40.

EFFECT ON OTHER DOCUMENTS

Rev. Ruls. 81-100, 2004-67, and 2008-40 are modified.

REQUEST FOR COMMENTS

The IRS requests comments on whether annuity contracts and/or
other tax-favored accounts held by plans described in § 401(a)
or § 403(b), such as pooled separate accounts supporting
annuity contracts that are treated as trusts under § 401(f),
should be permitted to invest in the group trusts described in this
revenue ruling. Comments should be submitted by April 11, 2011, to
CC:PA:LPD:PR (Rev. Rul. 2011-1), Room 5203, Internal Revenue Service,
POB 7604 Ben Franklin Station, Washington, D.C. 20044. Comments may
be hand delivered Monday through Friday between the hours of 8 a.m.
and 4 p.m. to CC:PA:LPD:PR (Rev. Rul. 2011-1), Courier’s Desk,
Internal Revenue Service, 1111 Constitution Ave., N.W., Washington
D.C. Alternatively, comments may be submitted via the Internet at Notice.comments@irscounsel.treas.gov. Please include
“Rev. Rul. 2011-1” in the subject line of any electronic
communication. All materials submitted will be available for public
inspection and copying.

DRAFTING INFORMATION

The principal author of this revenue ruling is Robert Walsh
of the Employee Plans, Tax Exempt and Government Entities Division.
For further information regarding this revenue ruling, please contact
the Employee Plans’ taxpayer assistance telephone service at
1-877-829-5500 (a toll-free number) between the hours of 8:00 a.m.
and 4:30 p.m. Eastern Time, Monday through Friday, or e-mail Mr. Walsh
at RetirementPlanQuestions@irs.gov.

[1] The Tax Equity and Fiscal Responsibility Act of 1982 (TEFRA),
Pub. L. No. 97-248, added § 401(a)(24) to the Code. With
respect to that section, the TEFRA conference report explains that
“the tax-exempt status of a group trust will not be adversely
affected merely because the trust accepts monies from (a) a retirement
plan of a State or local government, whether or not the plan is a
qualified plan and whether or not the assets are held in trust, or
(b) any State or local government monies for use in satisfying an
obligation of such State or local government to provide a retirement
benefit under a governmental plan.” H.R. Conf. Rep. No. 760,
97th Cong., 2nd Sess. 81, 1982-2 C.B. 682.